The free Mortgage Calculator helps you determine your exact monthly payment, total interest paid, and how much home you can realistically afford. It covers both fixed and adjustable rate mortgages and breaks down your full PITI payment — Principal, Interest, Taxes, and Insurance — in seconds.
How the Mortgage Calculator Works
Your monthly Principal & Interest payment is calculated using the standard amortization formula: M = P × [r(1+r)^n] / [(1+r)^n − 1], where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12), and n is the total number of payments. In early years, most of your payment goes toward interest; as the balance falls, more goes to principal. Our calculator adds property taxes and insurance to show your full PITI, and applies PMI if your down payment is below 20%.
3 Real-World Examples
$350,000 home, 20% down ($70k), 6.5% rate, 30-year fixed → $1,770/month (P&I only), ~$277,000 total interest. With taxes + insurance + PMI, expect $2,200–$2,500/month total.
$280,000 remaining balance at 7.5%, refinanced to 6.0% → payment drops from $1,958 to $1,679, saving $279/month. Over the remaining loan life that adds up to $100,000+ in savings.
$400,000 at 6.5%: 30-year = $2,528/mo + $510k interest vs. 15-year = $3,488/mo + $228k interest. Choosing 15-year saves $282,000 in interest but costs $960/month more — a powerful trade-off if cash flow allows it.
Tips to Lower Your Mortgage Payment
- Improve your credit score to 740+ before applying — even a 0.25% rate reduction saves thousands over the loan term.
- Put down at least 20% to eliminate PMI and reduce your loan balance from day one.
- Shop at least 3–5 lenders; rate differences of 0.5% are common and mean $30,000–$50,000 over a 30-year loan.
- Consider a 15-year mortgage if you can handle the higher payment — you'll build equity twice as fast and pay far less interest.
Understanding Mortgage Amortization
Amortization means your loan is paid off in equal monthly installments, but the split between principal and interest shifts over time. In month 1 of a $280,000 loan at 7%, roughly $1,633 goes to interest and only $229 to principal. By year 20, those amounts nearly reverse. This is why refinancing early in a loan has the biggest impact — you're still in the interest-heavy phase. Making even one extra principal payment per year can shorten a 30-year mortgage by 4–6 years.